IMF supports ECB proposal to raise provisions on bad loans

[WASHINGTON] The International Monetary Fund strongly supports the European Central Bank's recent proposal to increase provision requirements for new non-performing loans, IMF European Department chief Poul Thomsen said on Friday.

The ECB recently proposed requiring lenders to increase loan loss provisions on newly classified non-performing, unsecured loans to 100 per cent over two years. For secured loans, provisions would need to rise to 100 per cent over seven years.

REUTERS